In a bid to help their businesses thrive, and lessen their tax burden, the Federal Government has initiated a plan that would exempt operators earning N25 million a year or less from the various taxes hindering their progress over time.
The Chairman of the Presidential Fiscal Policy and Tax Reforms Committee, Taiwo Oyedele, stated this at the closing session of the committee hearing on Sunday in Abuja.
He noted that the government was working on a system that would provide tax relief to 95 percent for the informal sector.
Oyedele said: ‘’So, we think that 95 percent of the informal sector should be legally exempted from all taxes; withholding tax, company income tax, even payee on their staff.
‘’We’re using data to inform our decisions. Currently, if you earn N25 million a year or less, you don’t have to pay company income tax, you don’t have to worry about VAT.
‘’We think that the informal sector are people who are trying to earn legitimate living, we should allow them to be and support them to grow to a point where they can then have the ability to pay taxes.”
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He said the new reforms being proposed would focus on the top five percent of that sector, the middle class, and the elite for taxes.
The tax expert said the committee is drafting the laws to effect the necessary changes in the fiscal policy and tax reform ecosystem of the country.
The new laws, according to him, will ensure that reviews become sustained by all governments coming in, adding that “we don’t want this whole effort to go down the drain, after one or two years”.
On compliance, the committee chairman urged all stakeholders to fully cooperate with the government in implementing a new fiscal and tax policy that would be used for the general good of the citizens.
“We think that the days of being above the law in paying taxes are over. The same thing we’re saying to our leaders, whether they are elected or appointed.
“We think they have to lead by example by showing that they have paid the taxes, not only on time, but correctly to the lawful authorities as contained in the various laws, ” he added.